Charter Hall Buys Perth Office, Mall for A$458 Million

By Nichola Saminather -
Jun 19, 2013

Charter Hall Group (CHC), which owns and
manages Australian commercial properties, said its unlisted
office fund and two partners will buy an office building and
mall in Perth for A$458 million ($435 million).

The acquisition in Perth’s center includes an office
building leased to the Bank of Western Australia Ltd. and the
Raine Square shopping center, anchored by a lease to Wesfarmers
Ltd (WES).-owned Coles supermarket, the Sydney-based company said in a
regulatory filing today. The shares had the biggest gain in more
than three years.

“The acquisition is in line with our strategy of raising
and deploying capital into core real estate investments,” David
Harrison, joint-managing director of Charter Hall, said in the
statement. “Despite the slowdown in the resource sector, we are
confident about the longer-term outlook for Perth and are
attracted to the security of a non-resource tenant of Bankwest’s
caliber.”

Charter Hall’s Core Plus Office Fund has partnered with a
domestic pension fund and a global institutional partner to
purchase the property from the receivers of Westgem Investments
Pty, according to the statement, which didn’t identify the
partners. The property has a combined lettable space of 61,564
square meters (662,669 square feet).

Charter Hall, which didn’t invest in the properties, will
manage them, it said. The acquisition won’t affect the company’s
earnings in the year ending June 30, and will add to income in
fiscal year 2014, it said.

Shares of Charter Hall surged 6.6 percent to A$3.89 at the
close of trading in Sydney, the biggest jump since February
2010. They have risen 19 percent this year, compared with a 4.6
percent increase in the benchmark S&P/ASX 200 Index.